You open your mail, and you find something unbelievable: a check for $10,000. You think it's an advertisement, but then you realize it's authentic. You could actually cash this piece of paper for real money. And you wonder: Is this a scam?
Check fraud has been on the rise lately, perhaps because this antiquated monetary system isn't as popular as it used to be, and recipients are less defensive than they used to be. Checks take longer to clear than cards and wire transfers, so victims often take more time to realize anything is wrong.
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As reported by the Better Business Bureau, billions of dollars in fake checks are circulated every year. They appear to come from legitimate companies and are sent to victims along with a seemingly simple offer.
The offer you should refuse
Here is one typical example: Auriyon Jacobs is a college student from Oakland, California. She received a note with an offer to advertise for PepsiCo. Thinking it was from a fellow student, she applied for the unusual publicity job: all she had to do was stick a Mountain Dew ad on her car to earn $250 per week.
Jacobs told CBS News the offer was to represent PepsiCo, and after sending in her application, she was given a check for nearly $5,000. Along with that, she was provided instructions to withdraw $3,500 and deposit it into the alleged scammer's account, you know, to cover the installation of the ad on her car.
She withdrew the money and, soon after, was alerted by her bank that the check she deposited was fake. Yet Jacobs was out $3,500. She had hoped to set this money aside for her tuition.
The check scam does not always revolve around an employment opportunity; sometimes it revolves around sweepstakes or grants, tech support, online purchases or rent.
The stolen routing number
Randy, one of my listeners, recently wrote to me with this story: "Last week my wife and I were notified by our bank that they received a digital "check" for near $15,000 for goods purchased through Cabela's website. The "check" had our tracking and account numbers complete with our address and the name of our bank. The check looked like one of ours minus a different name in use."
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But that wasn't all; Randy also learned of a Capital One credit card, which was being used to withdraw money from his account. He had never heard of the card, and he quickly put a stop on it. He called the Cabel'’s fraud hotline and received a prompt and professional response. All of the money has been refunded, he says.
Randy and his wife were lucky, and he told me he will now be more watchful of his data. One routing and account number can go a long way, especially if hackers can discern a little more information about you. Digital checks are easier to forge, yet physical checks can be printed almost anywhere, and with the right combination of banking info, a sophisticated thief can do a lot of damage.
Randy said something else, too: When he called the Cabela's fraud department, the service rep claimed to have seen three similar check scams that week.
How bad is it?
The Better Business Bureau noted that the one thing each scam has in common is fraudulent checks, which may not be identified as fake until days after they are deposited. There were nearly 30,000 fake check complaints submitted in 2017, with people reporting losses of almost $38 million.
People in their 20s accounted for 21 percent of the complaints over the last two years. According to CBS News, the postal inspection service said it confiscated $62 billion of fake checks in 2017.
What to avoid
Like all identity theft, the onus is on you to protect yourself. The Better Business Bureau states that one of the best ways to avoid falling prey to the scam is to be very careful when receiving a check from someone you do not know. Do what you can to verify where it came from and why you got it, as that will go a long way toward ensuring everything is copacetic.
Meanwhile, if you do deposit a seemingly random check, one that is not from a friend or family member and has nothing to do with payroll, wait at least two weeks to be sure it cleared before spending any of it. This way, if it is fake and bounces, at least you will not be out any of your money.
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